On January 15 of the current taxable year,Merle sold stock with a cost of $40,000 to his brother Ned for $25,000,its fair market value.On June 21,Ned sold the stock to a friend for $26,000.
a. What are the tax consequences to Merle and Ned?
b. Would Ned recognize any gain if he sold the stock for $ \$ 41,000 $ ?

Question

On January 15 of the current taxable year,Merle sold stock with a cost of $40,000 to his brother Ned for $25,000,its fair market value.On June 21,Ned sold the stock to a friend for $26,000.
 a. What are the tax consequences to Merle and Ned?
b. Would Ned recognize any gain if he sold the stock for $ \$ 41,000 $ ?

Quizplus · Accepted Answer

The Answer of On January 15 of the current taxable year,Merle sold stock with a cost of $40,000 to his brother Ned for $25,000,its fair market value.On June 21,Ned sold the stock to a friend for $26,000.
 a. What are the tax consequences to Merle and Ned?
b. Would Ned recognize any gain if he sold the stock for $ \$ 41,000 $ ?

On January 15 of the Current Taxable Year,Merle Sold Stock $41,000 \$ 41,000 $41,000

On January 15 of the Current Taxable Year,Merle Sold Stock $\$ 41,000$